Consolidated statement of earnings of anonymous corporation

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Reference no: EM131004109

The consolidated statement of earnings of Anonymous Corporation for the year ended December 31, 2007, is as follows:

Net sales	$1,550,010,000
Other income, net	10,898,000
	1,560,908,000
Costs and expenses: Cost of goods sold	1,237,403,000
Depreciation and amortization	32,229,000
Selling, general, and administrative	178,850,000
Interest	37,646,000
	1,486,128,000
Earnings from continuing operations before income taxes and equity earnings	74,780,000
Income taxes	37,394,000
Earnings from continuing operations before equity earnings Equity in net earnings of unconsolidated subsidiaries and affiliated companies	37,386,000 27,749,000
Earnings from continuing operations Earnings (losses) from discontinued operations, net of applicable income taxes	65,135,000 6,392,000
Net earnings	$71,527,000

Required:

a. Compute the times interest earned for 2007.

b. Compute the times interest earned for 2007, including the equity income in the coverage.

c. What is the impact of including equity earnings from the coverage? Why should equity income be excluded from the times interest earned coverage?

Reference no: EM131004109

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